Transportation &

Transshipment &
Assignment Problems
EM 640 Distribution Logistics
In class documents
 Transportation Problem
• A product is transported from a number of sources
to a number of destinations at the minimum
possible cost.
• Each source is able to supply a fixed number of
units of the product, and each destination has a
fixed demand for the product.
• The linear programming model has constraints for
supply at each source and demand at each
destination.
• All constraints are equalities in a balanced
transportation model where supply equals demand.
• Constraints contain inequality
 Transportation Problem
Network Presentation
 Transportation Problem
• Hardgrave Machine Company produces computer
components at its plants in Cincinnati, Kansas City, and
Pittsburgh.
• Plants not able to keep up with demand for orders at
four warehouses in Detroit, Houston, New York, and Los
Angeles.
• Firm has decided to build a new plant to expand its
productive capacity.
• Two sites being considered:
o Seattle, Washington and
o Birmingham, Alabama.
• Both cities attractive in terms: labor supply, municipal
services, and ease of factory financing.
Transportation Problem
Transportation Problem
Transportation Cost per unit
 Transportation Problem
Unit cost = Transportation cost (one unit) + Production
cost (one unit)
 Transportation Problem
• Variables with Seattle
From/To Detroit Houston New York Los Angeles
Cincinnati x11 x12 x13 x14
Kansas City x21 x22 x23 x24
Pitsbourgh x31 x32 x33 x34
Seattle x41 x42 x43 x44

• Objective Function Defined

Minimize Overall Shipping Costs:
Min 73x11 +103x12 + 88x13 +108x14 + 85x21 +80x22
+ 10023 +90x24 + 88x31 +97x32 + 78x33 +118x34 + 113x41
+91x42 + 118x43 +80x44
 Transportation Problem
• Constraints
x11 + x12 + x13 + x14 =15000
x21 + x22 + x23 + x24 = 6000
x31 + x32 + x33 +x34 = 14000
x41 + x42 + x43 +x44 = 11000
x11 + x21 + x31 + x41 = 10000
x12 + x22 + x32 + x42 = 12000
x13 + x23 + x33 + x43 = 15000
x14 + x24 + x34 + x44 = 9000
Non-negativity of Variables: xij > 0, for all i and j.
Transportation Problem
This model includes new plant at Seattle
 Transportation Problem
• Variables with Birmingham
From/To Detroit Houston New York Los Angeles
Cincinnati x11 x12 x13 x14
Kansas City x21 x22 x23 x24
Pitsbourgh x31 x32 x33 x34
Birmingham x41 x42 x43 x44

• Objective Function Defined

Minimize Overall Shipping Costs:
Min 73x11 +103x12 + 88x13 +108x14 + 85x21 +80x22
+ 10023 +90x24 + 88x31 +97x32 + 78x33 +118x34 + 113x41
+91x42 + 118x43 +80x44
 Transportation Problem
• Constraints
x11 + x12 + x13 + x14 =15000
x21 + x22 + x23 + x24 = 6000
x31 + x32 + x33 +x34 = 14000
x41 + x42 + x43 +x44 = 11000
x11 + x21 + x31 + x41 = 10000
x12 + x22 + x32 + x42 = 12000
x13 + x23 + x33 + x43 = 15000
x14 + x24 + x34 + x44 = 9000
Non-negativity of Variables: xij > 0, for all i and j.
Transportation Problem
This model includes new plant at Birmingham
 Transportation Problem
• Network solution & Business Decision
10000
15000 Cincinnati Detroit 10000

4000
1000
6000 Kansas City
6000 Houston 12000

14000
14000 Pittsburgh
15000
New York
2000

Seattle 9000
11000 Los
$3,704,000 9000
Angeles

Birmingham
$3,741,000
 Transshipment Problem
Characteristics
• Extension of the transportation model.
• Intermediate transshipment points are added
between the sources and destinations.
• Items may be transported from:
o Sources through transshipment points to destinations
o One source to another
o One transshipment point to another
o One destination to another
o Directly from sources to destinations
o Some combination of these
Transshipment Problem
 Transshipment Problem
#1
• The Northside and Southside facilities of Zeron
Industries supply three firms (Zrox, Hewes, Rockrite)
with customized shelving for its offices. They both
order shelving from the same two manufacturers,
Arnold Manufacturers and Supershelf, Inc.
• Currently weekly demands by the users are 50 for
Zrox, 60 for Hewes, and 40 for Rockrite. Both Arnold
and Supershelf can supply at most 75 units to its
customers.

Additional data is shown on the next slide.

 Transshipment Problem
#1
• Because of long standing contracts based on past
orders, unit costs from the manufacturers to the
suppliers are:
Zeron N Zeron S

Arnold 5 8
Supershelf 7 4

• The costs to install the shelving at the various

locations are:
Zrox Hewes Rockrite

Zeron N 1 5 8
Zeron S 3 4 4
 Transshipment Problem
#1
• Network Presentation
 Transshipment Problem
#1
Linear Programming Formulation
• Decision Variables Defined
Variables
Zeron N Zeron S Zrox Hewes Rockrite
Arnold x13 x14 Zeron N x35 x36 x37
Supershelf x23 x24 Zeron S x45 x46 x47

• Objective Function Defined

Minimize Overall Shipping Costs:
Min 5x13 + 8x14 + 7x23 + 4x24 + 1x35 + 5x36 + 8x37 + 3x45 + 4x46 + 4x47
 Transshipment Problem
#1
• Constraints

Amount Out of Arnold: x13 + x14 < 75

Amount Out of Supershelf: x23 + x24 < 75
Amount Through Zeron N: x13 + x23 - x35 - x36 - x37 = 0
New
Amount Through Zeron S: x14 + x24 - x45 - x46 - x47 = 0
Amount Into Zrox: x35 + x45 > 50
Amount Into Hewes: x36 + x46 > 60
Amount Into Rockrite: x37 + x47 > 40

Non-negativity of Variables: xij > 0, for all i and j.

Transshipment Problem
#1
Transshipment Problem
#1
Transshipment Problem
#1
 Assignment Problem
Special type of LP, in fact a special type of
Transportation problem.

Assignment problem - a balanced transportation

problem where all supplies and demands are equal to
one.

Assignees (workers, processors, machines, vehicles,

plants, time slots) are being assigned to tasks (jobs,
classrooms, people).
 Assignment Problem
#1
• A manager has prepared a table that shows the cost of
performing each of five jobs by each of five employees.
• Job I will cost $15 if done by Al. $20 if it is done by Bill,
and so on.
• The manager has stated that his goal is to develop a set
of job assignments that will minimize the total cost of
getting all five jobs done. It is further required that the
jobs be performed simultaneously, thus requiring one job
being assigned to each employee.
• In this example, with a 5X5 table, there are 5! = 120
different possibilities; but with, say, a 7X7 table, there are
7! = 5,040 possibilities.
 Assignment Problem
#1
• Cost of Each Assignment by each employee
 Assignment Problem
#1
• Variables
 Assignment Problem
#1
Minimize Z = 15x11 + 20x12 + 18x13 + 24x14 + 19x15 +
12x21 + 17x22 + 16x23 + 15x24 + 14x25 +
14x31 + 15x32 + 19x33 + 17x34 + 18x35 +
11x41 + 14x42 + 12x43 + 13x44 + 15x45 +
13x51 + 16x52 + 17x53 + 18x54 + 16x55

subject to:
x11 + x12 + x13 + x14 + x15 = 1 (job 1 will be assign to one employee)
x21 + x22 + x23 + x24 + x25 = 1 (job 2 will be assign to one employee)
x31 + x32 + x33 + x34 + x35 = 1 (job 3 will be assign to one employee)
x41 + x42 + x43 + x44 + x45 = 1 (job 4 will be assign to one employee)
x51 + x52 + x53 + x54 + x55 = 1 (job 5 will be assign to one employee)
x11 + x21 + x31 + x41 + x51 = 1 (Al will be assigned to one job)
x12 + x22 + x32 + x42 + x52 = 1 (Bill will be assigned to one job)
x13 + x23 + x33 + x43 + x53 = 1 (Cindy will be assigned to one job)
x14 + x24 + x34 + x44 + x54 = 1 (David will be assigned to one job)
x15 + x25 + x35 + x45 + x55 = 1 (Earle will be assigned to one job)

Non-negativity of Variables: xij > 0, for all i and j.

Assignment Problem
#1
Assignment Problem
#1
Assignment Problem
#1
 Assignment Problem
#1
• Assignment network solution for employees

Al Job 1

Bill
Job 2

1
Cindy 1
Job 3

1
David
Job 4

1
Earle
Job 5
 Summary
Three models were presented:
1. Transportation model deals with distribution of
goods from several supplier to a number of
demand points.
2. Transshipment model includes points that permit
goods to flow both in and out of them.
3. Assignment model deals with determining the most
efficient assignment of issues such as people to
projects.